We've all heard how the h.264 is rolled over on patents and royalties. Even with these facts, I kept supporting the best-performing "delivery" codec in the market, which is h.264. "Let the best win", I kept thinking. But it wasn't until very recently when I was made aware that the problem is way deeper. No, my friends. It's not just a matter of just "picking Theora" to export a video to Youtube and be clear of any litigation. MPEG-LA's trick runs way deeper! The [street-smart] people at MPEG-LA have made sure that from the moment we use a camera or camcorder to shoot an mpeg2 (e.g. HDV cams) or h.264 video (e.g. digicams, HD dSLRs, AVCHD cams), we owe them royalties, even if the final video distributed was not encoded using their codecs! Let me show you how deep the rabbit hole goes.

UPDATE:Engadget just wrote a reply to this article. The article says that you don't need an extra license to shoot commercial video with h.264 cameras, but I wonder why the license says otherwise, and Engadget's "quotes" of user/filmmaker indemnification by MPEG-LA are anonymous...

UPDATE 2:Engadget's editor replied to me. So according to him, the quotes are not anonymous, but organization-wide on purpose. If that's the case, I guess this concludes that. And I can take them on their word from now on.

UPDATE 3:And regarding royalties (as opposed to just licensing), one more reply by Engadget's editor.

In responding to this article and the resulting debate I need to introduce you all to a part of the text of a free PDF book, The Road Ahead from a Grass Roots Perspective that I have placed on my own web site. www.chriscoles.com

There are two aspects to this debate, the application of true free market rules and the consideration that the rule of the law is today; Moot!

Taking the free market first, I argue in Chapter 5 The Rules for a True Free Market that the seller may not retain any ownership of whatever is sold, downstream of the moment of sale.

Page 62 reads:

"Returning to the auction, that sale price is determined by creating an opportunity for the maximum number of potential buyers to immediately bid based upon the perceived worth, (of their purchase), to them downstream from that purchase. We call that a marketplace. The moment the bid is accepted the sale takes place; payment is made and immediately the ownership of what is being sold changes.

This point of sale is fundamentally important. If the seller retained ownership, the free market would not work as there would be an obligation upon the buyer that transferred value created by the buyer back to the seller beyond the power of the market to adjust.
The immediate transfer of ownership is thus a fundamental aspect of a free market.

The seller has to accept the price the market will deliver that day for the concept of the free market to work. The price paid must be the market price of that day. The buyer has priced his bid based upon their knowledge of the cost of whatever onward process they have in mind. The price to the final consumer is adjusted accordingly. If that buyer fails to sell on at their final market price, then they cannot afford to go back and buy more at that price and must adjust their bid accordingly."

In which case, imposing royalties downstream of the sale breaches these rules.

In chapter 12, The Responsibilities of Government I am arguing that my own patents have been openly infringed by the US government. Now, at first sight you might consider this to be a counter argument, but if you read the whole book you will see that instead, I am arguing that the US is a Feudal nation and is not operating to the rules of a true free market. In which case, I believe that the entirety of my input to the debate is that law has become adversarial and unrepresentative to the needs of a free society.

In part, page 108 reads:

“What I have found myself through my dealings with government, particularly the government of the United States, is that in fact, that relationship has broken down.

That the government of the United States is quite prepared to ignore their own law, if that will suite their own purposes.

I believe that we have to face the truth of this breakdown and seek a way forward; back to re-establishing the full rule of the law by government itself.

A great part of the problem is that attorneys employed by government today, have lost contact with their ethics. By that, I mean that the high principle engendered by the concept of the rule of law has been usurped. Rather than abide by the rule of the law to the highest ethical standards and accept that sometimes even a great government can have duties engendered by the law it enacts; the principle of unjust, unethical actions designed to usurp the true meaning of the law, rather than strictly abide has gained credence and today, the rule of the law is as a result moot. That governments, by the action of their attorneys, have placed themselves into the position of both being the font of all law while at the same time, refusing to accept the responsibilities engendered by the rule of law.

I believe that makes such governments lawless, Ultra Vires; Law beyond one's legal power and authority.”

Move forward to page 112, I go on to say:

“I believe that there is a clear perception today, held by the attorneys of the government, that a government department may do as it wishes with an individual’s property that comes its way.

I believe that that is theft and there is no other way to look at it. Consideration was not agreed or paid, no transaction has taken place. No deal accepted. Ownership remains with the individual.

I believe that the Government of the United States must recognise that there is this perception at large and that it is causing great damage to the reputation of the law in the United States. I further believe that it is the responsibility of the lawmakers to look again at this matter and create a set of clear, unambiguous rules of engagement, a framework of ethical rules to the highest standard, that we on the outside can see in place and that those on the inside can see they must abide by.

Without that structure, a level playing field if you like, the actions taking place today stain the reputation of what many of us do sincerely believe to be the finest country on the planet.

I was led to believe that the United States of America wanted individuals like me; but I now believe that the government attorneys will do anything in their power to prevent someone like me prosper.

That, ladies and gentlemen; is feudalism.

It has always been my understanding that the United States was founded upon the realisation that feudalism is a failed concept. That the efforts of the free individual and their intellectual property coupled to capital has made your nation wealthy, powerful and strong. I believe that within the United States government, that lesson has been lost.

Think about that? Why has this come about?

The answer has to be that the practice of law has become totally adversarial. Everyone is the enemy.
In corporate law, yes, the attorney is there to protect the interests of the corporation; but it must be seen that in government, particularly where competition law comes into play, the primary responsibility has to be to encourage competition. The government attorney has a much wider responsibility – the encouragement of a successful nation.

If the government attorney has only a view that their responsibility is to protect the government, then everyone outside the government is an enemy. That the citizen is to be held at bay and controlled; that success is to be trammelled by the idea that they must not interfere with the aiming point of the government.

I would argue instead that it is the governments responsibility to do everything it can to encourage the success of any citizen, (or in my case anyone wanting to join your nation as a citizen), in their lawful pursuit of making the most of their particular talents and aspirations.

It is a very real aspect of a feudal society, that those with power will do everything in their power to prevent the success of the ordinary citizen. Why? Easy to answer, merit always shines so brightly.

The great embarrassment of an “old school tie” without merit is to see themselves outshone by a bright shining upstart. In those circumstances, they have every vested interest in the failure of the more successful.

As His Grace The Earl of Clanwilliam once said to me: “Everyone has a vested interest in your failure”. (Private comment made at a UK Department of Transport conference on the subject of the Stonehenge).

I argue that it must be recognised that the greatest responsibility of the government attorney, in any government; is to see that, in the pursuit of lawful gain, those with merit are encouraged to succeed; that by so encouraging, they prevent the establishment of a feudal society and encourage a free and prosperous nation.”

The answer to the question first posed is that ALL Law needs to be reviewed with the objective of on the one hand opposing anything that continues to impose a feudal society on the people, while on the other hand, empowering the individual citizens in their own, personal, creativity.

If you can show government are themselves outside of the law, Ultra Vires, then you empower any argument regarding the way existing law is applied.